Happy Friday! ‘This week in CX’ brings you the latest roundup of industry news.
This week, we’ve been looking at why you need to level up your CX strategy and how to adapt it to new generations, as well as how are young workers changing the workplace one problem at a time.
We’re also discussing new updates from Meta, NHS, Sephora and more!
Key news
- Meta, the owner of Facebook and Instagram, is funding new technology that’s designed to support the NHS. The Silicon Valley tech giant asked more than 200 programmers across 56 teams to dream up ideas for how its Llama artificial intelligence system could be used in UK public services linked to healthcare, clean energy and social mobility. The winning team, Guardian, created a concept of an AI-powered triage assistant which could reduce waiting times and better allocate resources in A&E departments.
- Black Friday has become a prime target for scammers, who are increasingly leveraging AI-driven tactics to deceive deal-seeking shoppers, warns Britain’s cybersecurity chief. Fraud linked to the shopping event resulted in losses exceeding £11.5m last Christmas – a £1m increase from 2022. Common schemes include fake listings for clothing and tech on social media and online marketplaces, with 16,000 online shopping fraud cases reported between November 2023 and January 2024. Victims are predominantly aged 30-39 (23%) or 40-49 (20%), and social media platforms feature in 43% of fraud reports. To stay safe, experts advise using credit cards, steering clear of high-pressure sales tactics, enabling two-step verification and thoroughly researching sellers on trusted review sites.
- LVMH-owned beauty retailer Sephora aims to double its UK business with at least 20 new stores over the next two to three years, while also bolstering its online presence. After an unsuccessful attempt in the 1990s and 2000s, Sephora’s return to the UK last year sought to benefit from shifts in the market like the closure of Debenhams and some House of Fraser locations. Focusing on dynamic in-store experiences, it has seen strong early success, with high shopper turnout at recent openings. The resilient UK beauty sector continues to grow despite economic challenges, with competitors like Boots, Superdrug and Space NK also expanding. Sephora’s push is heating up competition in the market, with Boots launching dedicated “Boots Beauty” stores. Former Boots MD Seb James revealed active efforts to counter Sephora’s return, underscoring the high stakes in the evolving beauty retail landscape.
CXM news stories
Here’s the full news stories that CXM have reported on in the past week. Learn all about the latest research about discrimination at work, latest concerns in retail and what is the new norm for UK employees.
Gen Z Wants Brands to Level Up Their AI Customer Service Game
Sixty percent of Gen Z craves the speed and convenience of AI-powered customer service, but still prefer human interaction for complex issues, according to a new survey conducted by Five9, provider of the Intelligent CX Platform. This paradox highlights the need for businesses to strike a balance between AI-powered solutions and the human touch to meet the evolving expectations of this tech-savvy generation.
Five9 conducted a survey of 1,000 Gen Z consumers and tracked customer experience interactions for a select group of these young shoppers. The study found that Gen Z is particularly open to AI for quicker resolutions, with 46% considering it ideal for simple fixes and 47% for generic questions. While nearly 60% of Gen Z appreciate AI’s faster response times over human interactions (40%) and its unmatched convenience (19%), 15% said they enjoy the personalized experience it can offer. Surprisingly, when interacting with brands, less than 40% of Gen Z respondents could not distinguish between AI and human interactions in chatbots, text, or email. This data underscores AI’s growing role in streamlining customer service for a generation that expects quick, efficient solutions.
Despite their desire for AI-driven customer experiences, nearly 65% of Gen Z consumers still prioritize human customer service for complex issues, finding AI-powered solutions not as trustworthy (47%) and reliable (36%). Human support is preferred for specific scenarios, such as billing (86%), high-value purchases (88%), and returns (77%), emphasizing the importance of empathy and problem-solving in these areas.
Sephora, Target, Nordstrom, and Apple are all winning over Gen Z with their top-notch customer service. But it’s not just the retail world that’s getting it right, as airlines like United, Singapore Airlines, and Delta are also flying high in the eyes of Gen Z travelers.
By understanding the preferences and expectations of Gen Z regarding AI in customer service, brands can create more effective and trustworthy experiences that foster loyalty and satisfaction.
Bad Customer Experiences Put Nearly $4 Trillion at Risk in Global Sales
Businesses around the world risk $3.8 trillion in sales due to bad customer experiences – a figure $119 billion higher than last year. New research from Qualtrics, based on World Bank data and the 2025 Consumer Trends Report, highlights the impact of customer experience on loyalty and spending.
As the holiday shopping season gets under way, consumers are prepared to spend their hard-earned dollars. The National Retail Federation forecasts holiday spending may reach a record level of $989 billion in the United States this year. But where those dollars are spent will be influenced by whether or not companies can deliver on shoppers’ expectations.
More than half (53%) of consumers say they will cut spending after a bad customer experience, and admit that one in 10 (12%) of their brand interactions don’t live up to expectations. The industry sectors most at risk of cuts in spending after a bad experience are fast food brands (66%), department stores (65%), online retailers (64%), auto dealers (63%), mobile phone providers (59%), and parcel delivery services (56%).
Customers also report their biggest customer experience pain points are service delivery issues (selected in 46% of bad experiences), communication problems (45%), and employee interactions (39%). Price (37%), quality (35%), and after-sales support (21%) are less of an issue, but remain red flags for brands.